With legal fees mounting, team Trump channels more money to ‘Save America’

With legal fees mounting, team Trump channels more money to ‘Save America’

June 26, 2023

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Facing multiple intensifying investigations, former US President Donald Trump has quietly begun diverting more of the money he is raising away from his 2024 presidential campaign and into a political action committee that he has used to pay his personal legal fees.

The change, which went unannounced except in the fine print of his online disclosures, raises fresh questions about how Trump is paying for his mounting legal bills – which could run into millions of dollars – as he prepares for at least two criminal trials, and whether his PAC, Save America, is facing a financial crunch.

When Trump kicked off his 2024 campaign in November, for every dollar raised online, 99 cents went to his campaign, and a penny went to Save America.

Former President Donald Trump speaking at a rally in Dayton, Ohio, on November 7, 2022.Credit: The New York Times

But internet archival records show that sometime in February or March, he adjusted that split. Now his campaign’s share has been reduced to 90 per cent of donations, and 10 per cent goes to Save America.

The effect of that change is potentially substantial: Based on fundraising figures announced by his campaign, the fine-print manoeuvre may already have diverted at least $US1.5 million ($2.25 million) to Save America.

And the existence of the group has allowed Trump to have his small donors pay for his legal expenses, rather than paying for them himself.

Steven Cheung, a spokesperson for Trump, did not answer detailed questions about why the Trump operation has changed how the funds he is raising are being split. Save America technically owns the list of email addresses and phone numbers of his supporters – one of the former president’s most valuable assets – and the campaign is effectively paying the PAC for access to that list, he explained.

“Because the campaign wants to ensure every dollar donated to President Trump is spent in the most cost-effective manner, a fair-market analysis was conducted to determine email list rentals would be more efficient by amending the fundraising split between the two entities,” Cheung said in a written statement.

The different rules governing what political action committees and candidate campaign committees can pay for are both dizzying and somewhat in dispute. But generally, a PAC cannot spend money directly on the candidate’s campaign, and a campaign committee cannot directly pay for things that benefit the candidate personally.

For more than a year, before Trump was a 2024 candidate, Save America has been paying for bills related to various investigations into the former president and his allies. In February 2022, the PAC announced that it had $US122 million in its coffers.

Attendees wearing Save America PAC dresses before a speech by Donald Trump during an event at Trump National Golf Club in Bedminster, New Jersey on June 13.Credit: Bloomberg

By the beginning of 2023, the PAC’s cash on hand was down to $US18 million, filings show. The rest had been spent on staff salaries, on the costs of Trump’s political activities last year – including some spending on other candidates and groups – and in other ways. That included the $US60 million that was transferred to MAGA Inc., a super PAC that is supporting Trump. And more than $US16 million went to pay legal bills.

Trump’s rivals are not similarly splitting their online proceeds with an affiliated PAC. The websites of former Vice President Mike Pence, former ambassador Nikki Haley and Senator Tim Scott of South Carolina direct all the proceeds to their campaign committees. The same goes for Florida Governor Ron DeSantis, former Governor Chris Christie of New Jersey and Vivek Ramaswamy.

“I think in this particular situation, specifically because of the use of the leadership PAC to pay legal expenses and potentially other expenses that would be illegal personal use of campaign money, there’s an unusual incentive for the leadership PAC to take in more than it normally would,” said Adav Noti, senior vice president and legal director of Campaign Legal Centre.

In the run-up to Trump’s latest campaign, his legal bills exploded in size. Save America spent $US1.9 million in what it identified as legal expenses in the first half of 2022. That figure ballooned to nearly $14.6 million in the second half of last year, federal records show.

In late 2022, a Trump adviser said that about $US20 million had been set aside by Save America PAC to cover legal expenses.

Since then, Trump has been indicted twice, once by a Manhattan grand jury on charges stemming from a hush-money payment to a porn star, and once by a federal grand jury in Florida on charges including violations of the Espionage Act arising from Trump’s possession of classified material and government records long after he left office.

A prominent attorney, Todd Blanche, left his white-collar law firm in April to join the former president’s legal team and is now representing him in both cases, and Trump recently met with about a half-dozen lawyers in Florida.

Trump’s legal troubles are deeply intertwined with his political campaign and fundraising efforts. His campaign store is selling an “I Stand With Trump” T-shirt showing the date of his indictment in Manhattan (“03.30.2023″) for $US36; it recently added a second shirt with his Florida indictment date (“06.08.2023”) for $US38. Half the featured items on the store’s landing page show a fake mug shot and the words “not guilty”.

And Trump’s usual legal strategy – delay, delay, delay – could prove costly as overlapping teams of white-collar lawyers defend him in the federal case and the Manhattan criminal case, as well as in the investigation in Georgia, where Trump could face yet another indictment this northern summer for his role in trying to overturn the 2020 election. He is also facing an intensifying investigation by special counsel Jack Smith into his efforts to cling to power after losing the election.

It remains unclear whether Trump will try to use his campaign funds to pay for lawyers, should he run into difficulties with the political action committee – and whether such a move would run afoul of spending rules.

“He can use the campaign to pay for legal bills that arise out of candidate or officeholder activity – and of course, some of the current legal matters fall into that category, and some do not, and some are in a grey area,” Noti said. “It really depends on what matter we’re talking about.”

Jason Torchinsky, a Republican election lawyer, said he believed Trump was barred from using Save America donations to pay his personal legal expenses now that he’s a candidate, arguing that doing so would be “an excessive contribution” under Federal Election Commission precedent. And he said Trump could not use campaign money at all because it would qualify as personal use.

Donald Trump at the Faith and Freedom Coalition policy conference.Credit: Bloomberg

There have been signs that Trump’s campaign has been carefully monitoring its expenses.

He has mainly attended events organised by other groups, as opposed to staging his own large-scale political rallies, which were the lifeblood of his two past runs for president and are one of his favourite parts of campaigning. Those rallies are expensive, costing at least $US150,000 and usually more than $US400,000.

Trump has held only one full-scale rally in the seven months he has been running, with a second scheduled on July 1 in South Carolina, his first in an early-nominating state. (A rally in Iowa on May 13 was cancelled after a tornado warning, though the weather cleared and DeSantis pointedly held an impromptu event nearby.)

People familiar with the Trump campaign’s plans have said that the dearth of rallies was as much about husbanding resources as it was about getting Trump to engage with voters in a more traditional way. The people also suggested that more large-scale events might come in the northern autumn, as the primary race heats up.

The fundraising surges that Trump experienced after his first indictment at the end of March and again in June are expected to obscure a broader fundraising slowdown. His campaign announced that he had raised $US12 million in the first week after his first indictment and $US7 million in the week after his second one. He will next disclose the state of his PAC and campaign’s finances in federal filings in July.

Trump is unusually dependent on online fundraising. He has held only one major campaign fundraiser that was billed as such by his team: the event at Bedminster, New Jersey, on the evening of his indictment. It raised $US2 million.

This article originally appeared in The New York Times.

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